Co Spacing Positioned To Accelerate Smme Development As Sector Faces High Failure Rates And Inequality

The weight of SMMEs in South Africa’s economy

SMMEs are central to South Africa’s economic future. According to the Small Business Growth Index, they contribute 34% of GDP and account for around 60% of total employment. Yet the National Development Plan (NDP) envisions an even greater contribution: by 2030, SMMEs should generate up to 90% of all new jobs.

However, the sector faces significant obstacles:

• South Africa has 2.7 million SMMEs, but only 792,000 operate formally.
• As many as 70% of new businesses fail within their first five years, according to government data.
• Gender disparities remain stark: 51% of SMMEs are male-owned, and female representation decreases as enterprises scale.

This paradox – critical economic importance versus fragile operating conditions – underscores the need for platforms that equip entrepreneurs with tools, networks, and environments to grow sustainably.

Why co-spacing matters more than ever

Given high failure rates, limited access to capital, informality, and isolation, entrepreneurs increasingly require supportive ecosystems rather than simply resources. Co-spacing offers a modern, strategic solution.

1. Lower Cost Barriers

   Traditional offices come with long leases, utilities, security, furniture, and maintenance. Co-spaces offer flexible, affordable memberships, enabling entrepreneurs to redirect capital toward product development, hiring, or market expansion.

2. Access to essential infrastructure

   Today’s co-spaces go far beyond desk rental. They typically include:

   • High-speed fibre
   • Backup power
   • Meeting and boardrooms
   • Business support services
   • Professional development and mentorship opportunities

   This democratises access to infrastructure previously accessible only to established organisations.

3. Built-in network and collaboration

   Co-spaces naturally create diverse, multi-sector communities. Entrepreneurs gain exposure to new partners, skills, and opportunities – sparking innovation, peer learning, and cross-sector collaboration that rarely occurs in isolation.

4. Flexibility, professionalism and well-being

   A distraction-free, professional environment improves productivity and mental well-being. Co-spaces also offer the practical advantage of a registered business address – essential for opening business bank accounts, formalising operations, and building credibility.

Black Umbrellas: Building the ecosystem entrepreneurs deserve

At Black Umbrellas (BU), we know entrepreneurship thrives when supported by structure, mentorship, and meaningful networks. Over the past decade, BU has built one of South Africa’s most robust SMME development ecosystems, providing:

• Mentorship and coaching: One-on-one guidance from experienced business leaders.
• Training and capacity building: Workshops and masterclasses covering finance, leadership, marketing, governance, and more.
• Access to funding networks: Connections to investors, grant-makers, and procurement opportunities.
• Entrepreneurial Community: A peer network where entrepreneurs share insights, collaborate, and grow together.

Our co-space integrates all these elements, transforming workspace into a springboard for sustainable success.

A catalyst for national economic growth

Co-spacing is not just beneficial for individual entrepreneurs; it strengthens the entire SMME ecosystem by:

• Increasing business survival rates
• Supporting the NDP’s 2030 job-creation targets
• Addressing systemic gaps in access to markets and networks
• Enabling more inclusive and equitable participation in the economy.

By empowering entrepreneurs to operate efficiently and innovate confidently, co-spacing accelerates national economic development.

Experience the Black Umbrellas Co-Space

Located at 6 Melville Road, 13th floor, Illovo Point, Johannesburg, Black Umbrellas’ fully equipped co-working space is more than a place to work – it is a community where ideas grow, businesses scale, and entrepreneurs thrive.

Whether you are launching a new venture or taking your business to the next level, our co-space offers:

• Flexible membership options
• Access to mentorship
• Supportive workshops and events
• A network of ambitious, like-minded entrepreneurs.

Book a tour, spend a day with us, or join an upcoming community event.

Experience how the right environment can transform your business journey.

“Working here has connected me with amazing people and boosted my productivity! Oh, and there’s free popcorn every Thursday – it's a cherry on top,” says Sbusiso.

Contact 010 900 2869 for further details.